-1- 06-0300-cv Powell v. Omnicom UNITED STATES COURT OF APPEALS 1 FOR THE SECOND CIRCUIT 2 3 August Term 2006…

-1-
06-0300-cv
Powell v. Omnicom
UNITED STATES COURT OF APPEALS 1
FOR THE SECOND CIRCUIT 2
3
August Term 2006 4
(Argued: February 8, 2007 Decided: August 7, 2007) 5
Docket No. 06-0300-cv 6
-------------------------------------------------------x 7
DOREEN POWELL, 8
Plaintiff-Appellant, 9
-- v. -- 10
OMNICOM, BBDO/PHD, 11
Defendants-Appellees. 12
-------------------------------------------------------x 13
B e f o r e : WINTER, WALKER, and SACK, Circuit Judges. 14
15
Appeal from a judgment of the United States District Court 16
for the Southern District of New York (William H. Pauley III, 17
Judge), denying plaintiff-appellant’s motion under Fed. R. Civ. 18
P. 60(b) to set aside a settlement agreement and reopen her civil 19
action. 20
AFFIRMED. 21
ELIZABETH A. MASON, New York, New 22
York, for Plaintiff-Appellant. 23
A. MICHAEL WEBER (Christina L. 24
Feege, on the brief), Littler 25

-- 1 of 17 --

-2-
Mendelson, P.C., New York, New 1
York, for Defendants-Appellees. 2
JOHN M. WALKER, JR., Circuit Judge: 3
In this appeal from a May 18, 2005, judgment of the district 4
court of the Southern District of New York (William H. Pauley 5
III, Judge), the question is whether plaintiff-appellant Doreen 6
Powell, who now has the legal equivalent of buyer’s remorse, 7
entered into a binding and enforceable settlement agreement with 8
defendants-appellees Omnicom and BBDO/PHD that concluded their 9
litigation. For the following reasons, we hold that the 10
settlement agreement is fully enforceable and that the district 11
court properly denied Powell’s motion to reopen the case. 12
BACKGROUND 13
Powell, a 52-year-old African American woman, began working 14
at BBDO, a subsidiary of Omnicom, in 1993. After she was 15
promoted to vice president in 1994, she allegedly fell victim to 16
numerous discriminatory acts relating to promotions, performance 17
evaluations, pay, choice of accounts, and assignment of 18
subordinates. Despite her complaints to management, Powell says 19
nothing was done. 20
On September 26, 2002, BBDO fired Powell, asserting that it 21
was because of her lack of seniority and failure to bill enough 22
business. Powell claims that these reasons were pretextual 23
because BBDO did not terminate many white employees who had less 24
seniority and billed less business. She also claims that BBDO 25

-- 2 of 17 --

-3-
retaliated against her by falsely reporting to the Department of 1
Labor that she had been discharged for misconduct. 2
On February 3, 2004, Powell sued BBDO and Omnicom under 3
Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et 4
seq.; the Age Discrimination in Employment Act of 1967 (“ADEA”), 5
29 U.S.C. § 621 et seq.; and various New York State and New York 6
City law violations. On June 23, 2004, after several hours of 7
negotiation, Powell, who was represented by counsel, and Omnicom 8
agreed to an in-court settlement before Magistrate Judge James C. 9
Francis, IV. Omnicom’s counsel recited the terms of the 10
settlement on the record: 11
• Neither party would admit any wrongdoing 12
• BBDO would pay Powell $35,000, from which no taxes 13
would be withheld 14
• BBDO would write “a mutually agreed upon positive 15
reference regarding Ms. Powell’s employment with BBDO 16
Detroit” 17
• BBDO would represent in writing to the Department of 18
Labor that it made an error in stating that Powell was 19
terminated for misconduct 20
• BBDO and Omnicom could still sue Powell for 21
“malfeasance and other intentional conduct” 22
• Neither party would disparage the other 23
• Powell would never apply for employment with the 24
defendants 25

-- 3 of 17 --

-4-
• Powell would represent that she had no other claims 1
pending against the defendants other than the federal 2
claims being settled 3
• The agreement would remain confidential 4
The magistrate judge then asked Powell if the terms of the 5
agreement were acceptable to her and whether “on the basis of 6
agreeing to those terms that this case will be terminated with 7
prejudice and cannot be reopened.” Powell responded 8
affirmatively on the record to both questions. 9
On June 29, 2004, the district court issued an order stating 10
that it had been informed that “this action has been or will be 11
settled.” It ordered the action discontinued without prejudice 12
to restore “if the application to restore the action is made 13
within thirty (30) days of the date of this Order.” 14
The parties attempted to reduce their agreement to writing, 15
but Powell refused to sign. On July 22, 2004, the district court 16
received a letter from Powell’s counsel asking that the case be 17
restored to the calendar. Counsel also requested that they be 18
relieved from representation due to “irreconcilable differences” 19
with Powell. Rather than restore the case to the calendar, the 20
district court ordered the parties to appear at a conference on 21
August 13, 2004. 22
At the conference, Powell accused her counsel of 23
misrepresenting that the $35,000 settlement would be tax-free and 24
pressuring her into accepting. Her counsel denied any 25

-- 4 of 17 --

-5-
misconduct. She also claimed that Omnicom’s reference letter was 1
unsatisfactory because it only stated that her performance at 2
BBDO was “satisfactory”; she wanted it to say that her 3
performance was “exemplary.” Powell’s counsel said that Omnicom 4
was “really working to try to refine the language to please Ms. 5
Powell” and had offered to state that her performance was “fully 6
satisfactory.” 7
Finding that Powell seemed to be “a sophisticated and 8
knowledgeable business woman,” the district court concluded that 9
the settlement was enforceable. It gave Powell the choice of 10
taking exception to the ruling and proceeding with the case or, 11
alternatively, working out the settlement’s details. Powell 12
chose the first option, and the district court relieved her 13
counsel. 14
On March 11, 2005, Powell submitted affidavits pro se in 15
support of a motion to vacate and set aside the settlement and 16
restore the case to the calendar. The district court construed 17
the affidavits as a motion to reopen under Fed. R. Civ. P. 60(b) 18
and denied the motion, finding that Powell “knowingly and 19
voluntarily entered into an in-court settlement agreement.” 20
Powell timely appealed. 21
DISCUSSION 22
Because Powell’s case had already been closed, the district 23
court did not abuse its discretion in construing her March 11 24
motion as a Rule 60(b) motion. See Lawrence v. Wink (In re 25

-- 5 of 17 --

-6-
Lawrence), 293 F.3d 615, 623 (2d Cir. 2002). We review the 1
denial of a Rule 60(b) motion for abuse of discretion. Rodriguez 2
v. Mitchell, 252 F.3d 191, 200 (2d Cir. 2001); see also Fennell 3
v. TLB Kent Co., 865 F.2d 498, 503 (2d Cir. 1989) (Feinberg, J., 4
concurring) (involving decisions to restore a case to the 5
calendar). We review the district court’s factual findings, 6
including whether a settlement agreement exists and whether the 7
parties assented to it, for clear error. Omega Eng’g, Inc. v. 8
Omega, S.A., 432 F.3d 437, 443 (2d Cir. 2005). 9
A settlement agreement is a contract that is interpreted 10
according to general principles of contract law. Id. Once 11
entered into, the contract is binding and conclusive. Janneh v. 12
GAF Corp., 887 F.2d 432, 436 (2d Cir. 1989), abrogated on other 13
grounds by Digital Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 14
863 (1994). When a party makes a deliberate, strategic choice to 15
settle, a court cannot relieve him of that a choice simply 16
because his assessment of the consequences was incorrect. United 17
States v. Bank of N.Y., 14 F.3d 756, 759 (2d Cir. 1994). 18
Powell argues, however, that in these particular 19
circumstances, the agreement was not binding because (1) it was 20
never reduced to writing; (2) the parties never intended to be 21
bound absent a writing; (3) it was made in violation of the Older 22
Workers Benefit Protection Act (“OWBPA”), Pub. L. No. 101-433, 23
104 Stat. 978 (1990) (codified as 29 U.S.C. § 626(f)); and (4) 24
the district court’s July 1, 2004 order expressly gave her the 25

-- 6 of 17 --

1 It is unclear whether the settlement of federal claims is
governed by New York law or federal common law. The draft
settlement agreement states that it is governed by New York law.
The parties have not raised this issue and seem to agree, at
least implicitly, that New York law applies. In Ciaramella v.
Reader’s Digest Ass’n, 131 F.3d 320 (2d Cir. 1997), we declined
to decide this question because New York law and federal common
law were materially indistinguishable. Id. at 322; see also
Monaghan v. SZS 33 Assocs., 73 F.3d 1276, 1283 n.3 (2d Cir. 1996)
(“[T]he federal rule regarding oral stipulations does not differ
significantly from the New York rule.”). The same is true here;
therefore, we will apply New York and federal common law
interchangeably.
2 Under New York law, the requirement that the settlement be on
the record and in open court serves as a limited exception to the
Statute of Frauds. Jacobs v. Jacobs, 645 N.Y.S.2d 342, 344-45
(App. Div. 3d Dep’t 1996); see also N.Y. C.P.L.R. 2104 (“An
agreement between parties or their attorneys relating to any
matter in an action, other than one made between counsel in open
court, is not binding upon a party unless it is in a writing
subscribed by him or his attorney or reduced to the form of an
-7-
right to have the case restored to the calendar if she moved for 1
such relief within 30 days of the issuance of the order. We hold 2
that the settlement agreement is binding and enforceable; it 3
therefore concluded the litigation. 4
I. Requirement of a Writing 5
Parties may enter into a binding contract orally, and the 6
intention to commit an agreement to writing, standing alone, will 7
not prevent contract formation. Winston v. Mediafare Entm’t 8
Corp., 777 F.2d 78, 80 (2d Cir. 1985) (applying New York law).1
9
Consequently, a “voluntary, clear, explicit, and unqualified 10
stipulation of dismissal entered into by the parties in court and 11
on the record is enforceable even if the agreement is never 12
reduced to writing, signed, or filed.”2 Role v. Eureka Lodge No. 13

-- 7 of 17 --

order and entered.”).
-8-
434, I.A. of M & A.W. AFL-CIO, 402 F.3d 314, 318 (2d Cir. 2005) 1
(per curiam). The settlement remains binding even if a party has 2
a change of heart between the time he agreed to the settlement 3
and the time those terms are reduced to writing. Millgard Corp. 4
v. White Oak Corp., 224 F. Supp. 2d 425, 432 (D. Conn. 2002). 5
Here, Powell and Omnicom entered into a “voluntary, clear, 6
explicit, and unqualified” settlement on the record in open 7
court: Omnicom recited the terms of the agreement on the record, 8
and Powell expressly assented on the record to those terms and 9
the dismissal of the case. Accordingly, the fact that the 10
settlement was never reduced to writing is insufficient to render 11
the settlement nonbinding. 12
II. The Parties’ Intentions to be Bound Absent a Writing 13
Powell contends that the parties did not intend to be bound 14
by the settlement in the absence of a writing. Parties who do 15
not intend to be bound until the agreement is reduced to a signed 16
writing are not bound until that time. Ciaramella, 131 F.3d at 17
322. Deciding whether the parties intended to be bound in the 18
absence of a writing requires us to consider (1) whether there 19
has been an express reservation of the right not to be bound in 20
the absence of a writing; (2) whether there has been partial 21
performance of the contract; (3) whether all of the terms of the 22
alleged contract have been agreed upon; and (4) whether the 23

-- 8 of 17 --

-9-
agreement at issue is the type of contract that is usually 1
committed to writing. Winston, 777 F.2d at 80; see also 2
Ciaramella, 131 F.3d at 323. “No single factor is decisive, but 3
each provides significant guidance.” Ciaramella, 131 F.3d at 4
323. After considering these factors, we conclude that the 5
parties in this case intended to be bound notwithstanding the 6
absence of a writing. 7
First, neither party made any express reservation to be 8
bound only by a writing. At the June 23, 2004 hearing, Omnicom’s 9
attorney stated without objection that the “parties have agreed 10
that the formal settlement documents will incorporate the 11
following terms and conditions,” suggesting that the settlement’s 12
reduction to writing was only a formality. 13
Second, there was partial performance of the settlement 14
agreement. At the June 23, 2004 hearing, Omnicom agreed to draft 15
a reference letter for Powell; Omnicom drafted this letter, with 16
the only remaining detail being whether it would say that 17
Powell’s performance was “fully satisfactory” or “exemplary.” 18
Third, the parties agreed to all of the material terms of 19
the settlement agreement at the June 23, 2004 hearing. Granted, 20
Powell later took issue with some of the language in the draft 21
agreement to which she had acceded at the June 23 hearing. This 22
includes principally BBDO’s right to take legal action against 23
her for gross malfeasance or intentional misconduct, which 24
Omnicom ultimately removed. We have held that even “minor” or 25

-- 9 of 17 --

-10-
“technical” changes arising from negotiations over the written 1
language of an agreement can weigh against a conclusion that the 2
parties intended to be bound absent a formal writing. See 3
Winston, 777 F.2d at 82-83. Such changes are relevant, however, 4
only if they show that there were points remaining to be 5
negotiated such that the parties would not wish to be bound until 6
they synthesized a writing “satisfactory to both sides in every 7
respect.” See id.; see also R.G. Group, Inc. v. Horn & Hardart 8
Co., 751 F.2d 69, 76 (2d Cir. 1984) (“A . . . factor is whether 9
there was literally nothing left to negotiate or settle, so that 10
all that remained to be done was to sign what had already been 11
fully agreed to.”). Here, Powell and Omnicom agreed at the June 12
23, 2004 hearing that BBDO reserved the right to sue Powell; 13
Powell’s subsequent disagreement with, and Omnicom’s eventual 14
release of, that right do not suggest that the point was left to 15
be negotiated after the hearing. 16
Powell argues that because the parties were unable to agree 17
on a mutually satisfactory reference letter and because Omnicom 18
has not removed the negative review from her personnel file, the 19
parties did not agree to all the terms of the settlement. This 20
argument, however, misses the point: They are relevant to 21
performance of the settlement rather than assent to its terms. 22
Powell also refers to certain representations in the draft 23
agreement to which she never agreed in court. These 24
representations relate principally to the statutory requirements 25

-- 10 of 17 --

-11-
for validly waiving rights under the ADEA (to be discussed 1
further, infra) to effectuate settlement. See 29 U.S.C. § 2
626(f). Because these representations simply follow the legal 3
preconditions for waiving rights under the ADEA, which was the 4
entire point of the settlement, we cannot view them as additional 5
terms subject to negotiation. 6
The fourth factor – whether this agreement is the kind that 7
would normally be reduced to writing - is a closer question. We 8
have held that a settlement, whose terms were not announced in 9
open court, for $62,500 paid over several years “strongly 10
suggest[ed]” that the parties would intend to be bound only by a 11
writing. Winston, 777 F.2d at 83. Similarly, we have held that 12
a settlement, also not announced in open court, containing 13
perpetual rights similar to those in the settlement at issue 14
would normally be put in writing. Ciaramella, 131 F.3d at 326. 15
That settlement, like this one, contained provisions concerning 16
how future requests for employee references would be handled, 17
prohibiting the plaintiff from reapplying for employment with the 18
defendant, and imposing confidentiality requirements. Id. 19
Unlike in Winston and Ciaramella, however, the terms of this 20
agreement were announced on the record and assented to by the 21
plaintiff in open court. In Ciaramella, we stated that 22
“[s]ettlements of any claim are generally required to be in 23
writing or, at a minimum, made on the record in open court.” Id. 24
(emphasis added). The significance of announcing the terms of an 25

-- 11 of 17 --

3 Whether the OWBPA applies to settlements made in-court and on
the record is an open question in this circuit. In the
unpublished decision Manning v. N.Y. Univ., No. 98-Civ.-
3300(NRB), 2001 WL 963982, at *11-16 (S.D.N.Y. Aug. 22, 2001),
the Southern District of New York held that the OWBPA does not
apply under those circumstances. On appeal, we expressly
declined to decide the question. See Manning v. N.Y. Univ., 299
F.3d 156, 164 (2d Cir. 2002) (per curiam). Because the parties
-12-
agreement on the record in open court is to ensure that there are 1
at least “some formal entries . . . to memorialize the critical 2
litigation events,” Willgerodt v. Hohri, 953 F. Supp. 557, 560 3
(S.D.N.Y. 1997) (quoting Dolgin v. Dolgin (In re Dolgin Eldert 4
Corp.), 31 N.Y.2d 1, 10 (1972)), and to perform a “cautionary 5
function” whereby the parties’ acceptance is considered and 6
deliberate, see Tocker v. City of N.Y., 802 N.Y.S.2d 147, 148 7
(App. Div. 1st Dep’t 2005). The in-court announcement here 8
functioned in a manner akin to that of a memorializing writing. 9
As a result, this factor, viewed in the light most favorable to 10
Powell, is neutral as to whether the parties intended to be bound 11
only by a writing. 12
Consequently, at least three of the four factors favor the 13
conclusion that the parties intended to be bound in the absence 14
of a writing. We therefore conclude that Powell was bound by the 15
in-court, oral settlement. 16
III. Powell’s Rights Under the OWBPA 17
Powell next argues that the settlement is invalid under the 18
OWBPA because it did not meet the OWBPA’s timing requirements. 19
Her argument is without merit.3
20

-- 12 of 17 --

assume that the OWBPA applies and we conclude that its
requirements were met in any event, there is again no need for us
to decide the question.
-13-
To protect the rights and benefits of older workers, 1
Congress amended the ADEA in 1990 through the OWBPA by adding, 2
inter alia, 29 U.S.C. § 626(f), which regulates employee waivers 3
and releases under the ADEA. Hodge v. N.Y. Coll. of Podiatric 4
Med., 157 F.3d 164, 166 (2d Cir. 1998); see also Oubre v. Entergy 5
Operations, Inc., 522 U.S. 422, 426-27 (1998). Under the OWBPA, 6
an individual may waive his rights only if the waiver is “knowing 7
and voluntary.” 29 U.S.C. § 626(f)(1). Section 626(f) provides 8
specific statutory requirements for a “knowing and voluntary” 9
waiver that the employer must meet in order for an employee to 10
waive his ADEA claims. Tung v. Texaco Inc., 150 F.3d 206, 209 11
(2d Cir. 1998). The failure to meet these requirements renders 12
the release unenforceable irrespective of general contract 13
principles. See Oubre, 522 U.S. at 427. 14
Section 626(f)(1)’s requirements, which apply generally to 15
waivers of ADEA claims, include, inter alia, that the individual 16
be given “a period of at least 21 days within which to consider 17
the agreement” and “a period of at least 7 days following the 18
execution of such agreement . . . [to] revoke the agreement.” 29 19
U.S.C. § 626(f)(1)(F), (G). 20
Powell cannot rely on those timing requirements because 21
under § 626(f)(2), they do not apply to actions such as Powell’s 22

-- 13 of 17 --

-14-
that are filed in court and allege age discrimination under 29 1
U.S.C. § 623. See also Hodge, 157 F.3d at 166-67. Section 2
626(f)(2) instead requires that “the individual [be] given a 3
reasonable period of time within which to consider the settlement 4
agreement.” The Equal Employment Opportunity Commission has 5
interpreted this requirement to mean “reasonable under all the 6
circumstances, including whether the individual is represented by 7
counsel or has the assistance of counsel.” 29 C.F.R. § 8
1625.22(g)(4). 9
Powell had a reasonable period of time to consider the 10
settlement. She was represented by counsel when the parties 11
entered the settlement. Further, Powell – a former corporate 12
vice president and sophisticated business woman – had nearly two 13
years between her termination and settlement negotiations to give 14
considered thought to how she wished to resolve this dispute. 15
Congress imposed statutory requirements for waiver to ensure that 16
“older workers are not coerced or manipulated into waiving their 17
rights to seek legal relief under the ADEA.” Syverson v. Int’l 18
Bus. Machs. Corp., 472 F.3d 1072, 1075-76 (9th Cir. 2007) 19
(quoting S. Rep. No. 101-263, at 5 (1990)). Recognizing that an 20
employee is vulnerable and at an informational disadvantage just 21
after he is terminated, the Senate report noted that an: 22
employee who is terminated needs time to recover from 23
the shock of losing a job, especially when that job was 24
held for a long period. The employee needs time to 25
learn about the conditions of termination, including 26
any benefits being offered by the employer. Time also 27

-- 14 of 17 --

-15-
is necessary to locate and consult with an attorney if 1
the employee wants to determine what legal rights may 2
exist. 3
4
S. Rep. No. 101-263 (1990), as reprinted in 1990 U.S.C.C.A.N. 5
1509, 1538-39. After the passage of nearly two years, Powell 6
plainly was not under “shock” or time pressure to settle. And 7
she advances no convincing arguments that she was. Therefore, 8
while only a few hours elapsed between the beginning of 9
settlement negotiations and Powell’s assent to those terms in- 10
court, this period of time was reasonable under the 11
circumstances. 12
Powell does not advance any serious arguments that the other 13
requirements of § 626(f)(2) were not met. The settlement 14
agreement is therefore enforceable notwithstanding the OWBPA. 15
IV. District Court’s Refusal to Restore the Case 16
Powell’s final argument is that the district court erred by 17
refusing to restore her case to the calendar when she requested 18
on July 21, 2004 that it do so. She focuses on the district 19
court’s June 29, 2004 order, which she claims gave her a 30-day 20
option to restore the case. She argues that because she made her 21
request within the 30-day period, that order required the 22
district court to grant it. 23
We acknowledge that the district court’s order lacked 24
clarity as to whether Powell was bound by the in-court 25
settlement. The order began by stating, “[i]t having been 26
reported to this Court that this action has been or will be 27

-- 15 of 17 --

-16-
settled.” The latter clause suggests that the parties had not 1
settled the case. Moreover, the language with respect to 2
restoring the action upon application suggests that the 3
settlement was not yet binding and that she would be able to 4
restore the action if she so chose. 5
Despite the order’s wording, the district court did not 6
abuse its discretion in denying Powell’s motion based upon its 7
investigation into the June 23, 2004 hearing. The district court 8
did not simply ignore Powell’s request; it promptly convened a 9
conference to determine the settlement’s enforceability and 10
thoughtfully considered whether to restore the action to its 11
calendar. Given the need for the district court to inquire into 12
the matter and the district court’s ability to reconsider any 13
previous indications of its intended rulings, we cannot say that 14
the district court abused its discretion in hearing from the 15
parties and, as shown above, properly concluding that the 16
settlement was binding. See Fennell, 865 F.2d at 503 (Feinberg, 17
J., concurring). Moreover, we have previously affirmed a 18
district court’s refusal to reinstate because of an enforceable 19
oral settlement after it dismissed the suit without prejudice to 20
reopen if the parties could not consummate settlement. See Role, 21
402 F.3d at 318. We also defer to the district court’s 22
reasonable and implicit interpretation of its own order that it 23
did not provide the parties with an unfettered option to reopen 24
the case. Cf. Casse v. Key Bank Nat’l Ass’n (In re Casse), 198 25

-- 16 of 17 --

-17-
F.3d 327, 334 (2d Cir. 1999) (“[A]n appellate court reviewing 1
bankruptcy orders should defer to a district court’s 2
interpretation of its own order . . . .” (internal quotation 3
marks omitted)). 4
CONCLUSION 5
For the foregoing reasons, the judgment of the district 6
court is AFFIRMED. 7

-- 17 of 17 --